Endo International said Thursday it is eliminating its 375-member branded pain medicine sales forces in the United States in a move that will allow the company to focus its resources on other core products.
The sales force consisted of full-time employees, contract sales representatives and internal support staff.
In addition, the company has decided to end a licensing deal with BioDelivery Sciences International (BDSI) and return to that company its Belbuca pain medicine. The termination means Endo will not have any future royalty or milestone payments to BDSI. Specific financial terms of the agreement have not been disclosed and are “not material” to Endo, the company said.
Endo said the moves are expected to generate $90 to $100 million in annual costs savings. The company plans to take a $62 million restructuring charge, which includes a $40 million non-cash intangible asset impairment charge, a result of the actions.
Among the products Endo intends to focus on going forward is Xiaflex, a product it acquired when it bought Auxulium pharmaceuticals last year for $2.6 billion. Xiafflex is approved to treat Dupuytren’s contracture, a hand disorder, and Peyronie’s disease, an erectile dysfunction. Endo is also studying the drug as a potential treatment for cellulite.
The company said its legacy pain relief portfolio products, which include Opana ER and Percocet, will be managed as mature brands.
“Since we entered into our licensing and development agreement with BDSI in 2012, the opioid market and Endo’s strategic priorities have evolved,” said Paul Campanelli, president and CEO of Endo (NASDAQ: ENDP). “While we continue to believe Belbuca is a differentiated asset, the product no longer aligns with Endo’s U.S. branded segment strategy and our focus on core assets, including Xiaflex, moving forward. We believe that this path provides our U.S. branded business with its best opportunity for success going forward.
Campanelli, who was named CEO of Endo in September, said the company is continuing a “product-by-product portfolio assessment” and work on a full corporate strategy, which it plans to discuss in greater detail when the company provides its fourth quarter and full year 2016 results in February.
Endo, which is based in Dublin, Ireland, has its U.S. headquarters in Malvern, Pa.
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